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'Tis the season to redeem vouchers

We all seem to be absolutely consumed by the power of online shopping, sometimes it seems to limited benefit, but as we enter the Christmas trading period, I suspect online buying will intensify.

"Some of you may have observed the "Grab One" opportunity offered by Dominos Pizzas over the past week."

The offer was the purchase of a coupon to entitle you to a $2 pizza. There was a maximum of 3 per purchase and you had to visit a Dominos outlet to collect your purchase, which had an expiry date of 6th December. Some 75,000 pizzas were purchased at close off. As that closed, the company posted a follow up offer of $4 pizzas. As of Sunday 12th of November they had sold 80,254 pizzas with the rest of the day to continue buying.

By my count, that's a total of 155,000 pizzas with a face redeemable value of close to $500,000. Now that's where this subject gets interesting. With the coupons having to be redeemed by the 6th December, there's a high chance that a large number will never be redeemed in time for the cut-off date. On the basis that only about 30% of such coupons are ever actually redeemed, it suggests Dominos are going to make a lot of money from un-redeemed coupons.

We really, as consumers are like sheep. This "Grab One" opportunity with such a low cost entry of $2 or $4 is what I would describe as "throwaway" money as the value is that low. However, there is little risk for the company as proven redemption is very low. It really is a win win for Dominos.

So is it fair and reasonable? Why not? All the customer has to do is redeem the coupon by a given date. If they don't redeem it then it is their problem, not the seller as the terms of purchase have been made very clear.

"I wonder however, how much money will be squandered by consumers over coming weeks as we enter Christmas. The last few years have seen purchased vouchers go down the drain from Dick Smith and more recently Nosh."

Despite the enthusiasm for online shopping, a level of maturity is required when making purchases that never have any likelihood of being redeemed. Where gift vouchers are concerned, buyers need to carefully consider the expiry date and the potential longevity of the retailer. "Giving money away" has no logic. Meanwhile those who purchased a pizza make sure you enjoy it!!

What’s the deal with electronics retailing in New Zealand? The landscape has been littered with failures and businesses which struggle to make a profit. Share Watch will look at the various electronics chains over the next few weeks.

Dick Smith is gone forever (admittedly, this had more to do with their problems in Australia). The Good Guys dipped their toes in the water here, but didn’t last long. Retravision, Hill & Stewart, Powerstore, LV Martin, Bond & Bond and Norman Ross are some of the brand names that have come and gone (although the stores often live on under new names).

Harvey Norman has watched these challengers come and go, with a business model which – from the outside at least – looks much the same as it did twenty years ago. They own many of their own sites, and sell appliances and furniture: a department store for the home.

They are the “market leader across all product categories” in New Zealand, and delivered record sales and record profits in the last year: sales of NZD $940 million, and EBIT of around $85 million. Harvey Norman have 39 stores across the country, and look very strong for the future.

The wider Harvey Norman operates in Australia and a number of other countries, and is in equally strong form across most of those. The company says that “To say that we’re pleased by the record-breaking results we are presenting today would indeed be an understatement. The results for the year ended 30 June 2017 are truly unprecedented in our 30-year history”.

In the Press

Local Media Highlights 7 November to 13 November 2017

Feeling helpless is why we don't think twice before we shop

Many shoppers are well aware splashing on unnecessary clothing is unethical, but they can't resist keeping up with "fast fashion". Those are the results of a study into shopper behaviour by University of Auckland masters student Ellinor King and honours student Reuben Yates. The pair looked at young shoppers' habits to find out why they continued to buy clothes that conflicted with their ethics.

First home buyers flocking to Rotorua for its affordability

Rotorua appears to be the place of choice for many of the Bay of Plenty's first home buyers, with property experts putting the city's popularity down to its affordability and lifestyle. There were 105 First Home Buyer mortgages issued by Westpac in the year to September, a decline from the 121 mortgages issued in the year to September 2016.

Investor borrowing drops by over a third in first year of mortgage restrictions

There's been an almost 40 per cent drop in the amount property investors are borrowing since tighter lending restrictions were introduced, providing more opportunities for first home buyers, a Manawatū mortgage broker says. Reserve Bank figures show investors borrowed $13.5 billion in mortgages across New Zealand in the 12 months to September 30.

Wellington Airport has lined up the world's biggest construction firm to partner on the runway extension and create tourism opportunities for the capital. On Sunday airport deputy chief executive Matt Clarke signed a Memorandum of Understanding (MOU) in Beijing with China State Construction Engineering Corporation (CSCEC) and airline, China Express.